Commodity prices fell as renewed worries about Greece’s debt problems pushed the U.S. dollar higher against the euro on safe-haven buying. Most commodities are priced in U.S. dollars. [O/R] [GOL/]

Meanwhile, stronger than expected Canadian inflation data increased expectations that the Bank of Canada will hike interest rates sooner rather than later this year. [ID:nN19500487]

“I think that markets are now realizing what the fixed income have realized for a while, and that is that in Canada interest rates are going to rise,” said Carlos Leitao, chief economist at Laurentian Bank Securities, in Montreal.

Higher rates are typically negative for stocks because they slow economic growth and increase borrowing costs for companies.

“I think the market has gotten itself into a situation where the valuations short-term have become quite stretched,” said Rick Hutcheon, president and CEO at RKH Investments.

“I think the market needs to catch its breath a little bit and I wouldn’t be surprised if we see some erosion in the next week or two,” Hutcheon said.

The index’s technology sector fell 1.2 percent, with concern over U.S. corporate results spilling over into Canada after Palm Inc PALM.O tumbled one day after it warned that quarterly revenues would be far below expectations. [ID:nN19134642]